4/21/22 Hampton Roads Mastermind Group Meeting

Hampton Roads April 2022 – Key Take-Aways

Jason El Koubi, Virginia Economic Development Partnership– guest speaker

• Job loss in Virginia averaged 10%, Hampton Roads a little over the 10% mark at the peak of the pandemic.  Today, Virginia is creeping back to the pre-pandemic baseline but the state as a whole is still down.
• In comparison to other states, Virginia is in a “sluggish posture”.  Overall VA is at the bottom of the stack in regards to returning to normal.  This is partially because of the fact that VA does not traditionally make big leaps in economic growth.  It is more of a slow and steady state.
• Another reason why the state is slow in coming out of the pandemic effect to the job market is because VA was not as impacted by the pandemic in regards to jobs as bad as other states.
• Economists believe the state will be back to a pre-pandemic job growth baseline by the end of the calendar year.
  • The construction market is back to where it was pre-pandemic, however it was not as affected as other markets during the pandemic.
• We have five big goals for Virginia’s economy.
  • Robust state growth.
  • Every region wins.
  • Best state for business.
  • Top state edo (reestablish VEDP as one of America’s most effective state economic development orgs).
  • Be a super collaborators a state.

• Virginia as a whole is projected to create 39k jobs, however in order to be in the top ten of states in regards to job growth we would need double that.
• In order to rank in the top states for job growth and economic growth, and to continue to pursue the 5 goals listed above we must improve our fundamental economic competitiveness, we need to also enhance our own capabilities as an organization, and then we need to focus on the industry sectors that have the biggest potential for job growth.
  • VA needs to focus on tech.  There is a lot of job growth potential in tech.

Chris Ambrosio – Vandeventer Black

• The Vandeventer Black Law Firm has merged with Woods Rogers out of Roanoke.  Merging two law firms that in essence have been operating in parallel in different halves of the state.
  • Will now have lawyers licensed in 20 states.
  • Also expands the areas we can serve now to include IPOs.
• The market continues to show that multi-family and storage are the properties trading the most.
• Retail leasing is also happening, but not the volume of pre-pandemic.
• Interest rates and inflation are being heavily monitored.

Jeff Parker – Colliers International

• In the retail world a lot of larger box users surfacing in the market picking up a lot of these spaces that have been in the market for a while.
• A lot of retail and restaurant activity, just not a lot of product out here.
• Rates are going up and lenders are getting a bit skittish.

Drew Ott – Colliers International

• Seeing a bit of an uptick in office space.
• Work from home is going to have a continued future so this will continue to affect space requirements going forward.
• A strong first quarter as it looks like things are starting to rebound.
• Anything that is 5k to 10k in square footage it gets immediately snatched up as there isn’t much available in that size.

Dawn Best – Vansant Gusler

• We are getting a lot of raw end development projects.

Keith Slattum – Dollar Bank

• Interests rates have gone and are going up.  People in January were locking in rates right around 3% and as of late I have seen it hit 5%.
• Re-financing has “fallen off a cliff”.  There is just no opportunity there because of the interest rates.
• Developers are having to put in a lot more money up front for interest reserves.
• There are a lot of disruptions in the market place.

Dan Shelton – Whiting-Turner

• Electrical, steel, roofing materials, and even insulation is still a problem.
• Despite that, still seeing a lot of activity in the market.
• Multi-family, warehousing,  and healthcare is still good.

Greg Schmitt – Kimley Horn

• Gas Stations, 7-11, Wawa’s still booming, looking for new sites.
• Across single family, multi-family, and industrial we are less than 1% vacancy.
• Multi-family market is going to stay strong.

Josh Gerloff – RRMM

• RRMM has long had a design build company, and has now decided to split off from the architects.
• We currently involved in a lot of Master Planning.
• There are a lot of mixed signals currently in the market.
  • We are busier than ever, but we just had our first project get killed because of construction costs.
  • Costs are doubling from the initial bids.

We are doing a lot of Master Planning and making money in doing so, but I have to wonder of these projects are going to happen.